Residual income, Financial Management

Assignment Help:

Residual Income

This is used for external reporting purposes. This term refers to the net income which is available for distribution to the firm's common stock holders. In managerial accounting it will provide the excess divisional or segment income over the product of the cost of capital for the organization multiplied by the average amount of capital invested during the period over which the income was earned in the division.


Related Discussions:- Residual income

Define advantage and disadvantage of internal rate of return, What are the ...

What are the advantages and disadvantages of the internal rate of return method? The internal rate of return (IRR) method is a discounted cash flow method and a number expressed

Explain the significance of financial analysis, Question 1 What are the li...

Question 1 What are the limitations of management accounting? Question 2 Explain the significance of financial analysis Question 3 What are the advantages of the value a

Role of special purpose vehicle, The financial institutions tha...

The financial institutions that originate the loans sell a pool of cashflow-producing assets to a specially created third party that is called a

Illustration of valuation using multiple discount rates, Illustration  ...

Illustration  Let us assume that Vishal Mehta & Co., (from Illustration 1) is using the following discounting rates in place of one rate:

Wha is asset turnover- performance ratios, Wha is Asset turnover- performan...

Wha is Asset turnover- performance ratios Asset turnover = Turnover/ Total assets or capital employed This demonstrates how much sales are generated for every £1 of capit

Explain about the primary and secondary markets, Explain about the primary ...

Explain about the primary and secondary markets. Primary and secondary markets: A primary market is a financial market wherein new matters of financial securities (both s

Explain foreign equity ownership restrictions, Explain foreign equity owner...

Explain foreign equity ownership restrictions. Why do you think countries entail these restrictions? Several countries restrict the maximum fractional ownership of local organiza

State about the equity owners, State about the equity owners Flip side...

State about the equity owners Flip side of the coin is that the equity owners are also owners of all the profits which remain after all the debt holders are paid their interes

Weighted-average cost of capital, A Company has the following capital struc...

A Company has the following capital structure: Debt: $2,000,000 Preferred: $1,000,000 Common: $4,000,000 Retained Earnings: $3,000,000 The amounts shown gives book values.  The m

Operating budget, Operating Budget It is a collection or set of formal ...

Operating Budget It is a collection or set of formal financial documents that details expected expenses and revenues, as like all other expected operating and financial transac

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd